There is often talk about pink currencies, and the power of LGBTQ+ consumers. But how much bang does your buck have? Here is the story of pink currencies, and why businesses should care about them.
The history of pink money
In 1994, furniture giant Ikea made the groundbreaking Dining Room TV ad. It featured a gay couple shopping for a dining room table, while chatting casually about where they met and their miscellaneous décor preferences.
Despite the fact that the ad only aired in three American states, and only during late-night slots long after “family-hour”, it was still met with controversy, outrage and calls for boycotts. This was three years before Ellen DeGeneres would open the rainbow-coloured doors of Hollywood.
LGBT representation in business and marketing practices has come a long way since then. In the decades leading up to Ikea’s Dining Room ad, the only companies who marketed specifically for the LGBT niche were alcohol and fashion brands.
Today, everyone from Facebook to Pepsi have launched campaigns specifically targeted at the LGBT community. But even in 2016, this does not always come without some form of public pushback and resistance.
Who are ‘pink spenders’?
Pink money is a term that is often used to describe the purchasing power of people in the LGBT community or households headed by LGBT individuals. ‘Pink’ is often added in front of a specific currency to refer to the gay purchasing power in that specific country. Notable examples are the Pink Dollar, the Pink Pound and the Pink Rand.
Over the past few decades, pink money has been lauded as the power behind the success of various music artists like Lady Gaga, Britney Spears, Madonna, Cher and Kylie Minogue.
Some activist groups have rallied against the idea that all gay people are high-income earners with no children. Homosexuality is not limited to rich consumers. The LGBT community stretches across all income groups, demographics and territories – some are rich and some are poor. Also, with adoption becoming more accessible, an increasing number of same-sex households include children. It is, however, safe to say that, if all else is equal, LGBT-headed households do tend to have more disposable income. This is purely because gay people, in general, are still less likely to have children, and LGBT-headed households very often consist of dual income earners.
What do the stats say?
– The CMI Community Marketing & Insights annual survey for 2015 revealed that 75% of LGBT individuals in the US earns more than $50 000 a year, with more than 18% earning more than $150 000 annually.
– The CMI report also indicated that 27% of gay men made the decision to purchase an Apple product purely because of Apple’s pro-LGBT practices, while 21% of gay women bought from Target for the same reason. 74% of LGBT individuals surveyed also refused to support Chick-fil-A because of the company’s anti-gay stance.
– In South Africa, the last LBM Gay Consumer Profile done by Lunchbox Media found that 51% of LGBT individuals surveyed had at least one tertiary qualification, and 54% of openly LGBT individuals earned more than R20 000 per month, with 23% earning more than R40 000 per month.
In the mid-90s, car manufacturer Subaru faced a serious decline in vehicle sales. After a number of failed marketing attempts, Subaru of America made the decision to return to the company’s original approach of targeting niche markets. A team was hired to find out who exactly was buying Subaru cars. The research team returned with 5 niche audiences that loved the Subaru brand. Among the 5 groups were teachers, doctors and lesbians.
There were a number of reasons cited as to why lesbian women loved Subaru vehicles: it is big enough – but not too big, its reliability, and the fact that it is not too flashy. They even liked the name, which is Japanese for the star constellation known as the Seven Sisters.
Subaru took a very risky leap in a time dominated by strong hatred towards anyone who did not tick the heterosexual box. The marketing campaigns that followed, targeting lesbian audiences, took Subaru into a new era of strong growth and increasing sales.
LGBT consumers, like most minority groups, are no doubt very loyal shoppers – and if statistics are to be believed, they have real monetary voting power.
When Subaru tested the waters in the 90s, they did not jump out of the closet waving rainbow flags on the back of unicorns (excuse the stereotype). Instead, they started with ad campaigns featuring hidden messages of support, like the names of famous lesbian icons on the number plates of cars displayed in newspaper ads, or interesting wordplays that were not necessarily picked up by conservative readers.
In 2018, hidden messages might not have the same effect. Nonetheless, the Subaru case study still proves that even small signs of inclusiveness and acceptance can be a step in the right direction.
If you want to show the LGBT community that you value them as customers, you can start by, well, treating them like everyone else.
Where to start?
Even in 2018, a business’s staff might require some training when it comes to dealing with diversity.
Like most things, change starts at home. Before businesses embark on an inclusive marketing campaign, they need to make sure that their employment policies, hiring practices and general treatment of staff accommodates employees from all spheres of life.
The industry and nature of a business will also dictate what strategies it might want to consider for pursuing pink money. If you are a manufacturer of toothpaste, for example, you don’t have to print the gay flag on your products. You can simply donate to equal rights organisations or display diversity in your advertising campaigns.
On the other hand, if you are the owner of a bed-and-breakfast, you might need to make more bold statements. For example, displaying a notification on your website to state that you are a LGBT-friendly establishment will definitely attract more LGBT customers. Same sex couples are very used to discrimination at hospitality establishments, and would easily rather opt for an establishment that openly guarantees equal treatment of all its patrons.
Truthfully, with current economic, political and social climates across the globe, it is almost reckless and counterproductive to not have your brand publicly supporting inclusiveness and equality. Simply put: be inclusive, be sensitive, be confident.
*This article has been adapted, and first appeared on Counting Coins.